SeaWorld has seen quite the public backlash after a documentary, Blackfish, essentially showed the stress and anguish that captivity puts on Killer Whales. The documentary tied a 2010 trainer death by Killer Whale to be due to the increased stress. After the documentary was released in 2013, severe backlash began hitting the park company. Even a year later in 2014, attendance at the company’s SeaWorld parks fell 4%. SeaWorld executives have attempted to calm public opinion on the issues raised by Blackfish, but unfortunately it appears that the company continues to get hit with earnings losses due to loss of public attendance and interest.
SeaWorld fourth quarter earnings miss estimates, revenue beats
During the fourth quarter, SeaWorld Entertainment reported a net loss of $0.29 per share, and a loss of $0.21 per share on an adjusted basis of one time costs. Revenue came in at $264.5 million for the quarter. Wall Street had estimated earnings of -$0.14 earnings per share on revenue of $254.4 million. On a full year basis SeaWorld earned $0.57 per share on revenue of $1.38 billion. While SeaWorld missed on its profit estimates, revenue did come above estimates, which is rather surprising considering the sever backlash that originally followed. SeaWorld Entertainment shares are up 7% year to date, but down -43% in the past year.
Public relations campaign set to begin in April
Executives told investors during the earnings call that it will be stepping up its efforts to revamp its public imagine that has been hurt by the documentary. SeaWorld Chairman David D’Alessandro told investors that the revamping plan will be a “reputational campaign that helps restore our reputation, and it can be described as a campaign about the truth of SeaWorld” (LA Times). Part of the campaign involves a $10 million donation to research and preservation of Orcas and an independent board of scientists to check in and make sure the Orcas are kept well. Additionally, the company has doubled the size of the Orca tanks, which will now cover 1.5 acres with 350 feet in length and 50 feet deep, holding 10 million gallons of water.
While fourth quarter earnings was a bit of a struggle for SeaWorld on an earnings basis, the company still came out with a profit for full year 2014. Additionally, with attendance dropping only a minimal 4%, SeaWorld may be beginning to turn the tides against its negative image. With the new public relations campaign underway in April, SeaWorld has the opportunity to further mend fences and get back to its more profitable “old days”.